At Southwest Airlines, the term “corporate family” is more than just an overused metaphor.

By Gina Imperato3 minute Read

Life at Southwest Airlines, like at so many companies, overflows with upbeat talk about “the corporate family.” At Southwest, though, family is more than just an overused metaphor for team spirit and commitment. The company is full of real families — married couples, parents and children, siblings. Southwest can’t say exactly how many of its employees are related. But it can say that it’s home to 763 married couples, or nearly 7% of its total workforce. The Landas of Dallas are the company’s “family values” champions, with 11 family members who work for Southwest.

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“We believe in nepotism,” says Sherry Phelps, the company’s director of corporate employment. “We encourage people to recommend family members who might make good employees. Our only rule is that one family member can’t supervise another.”

The very idea of family at work conjures up worries about conflicts of interest, favoritism, and other headaches. But Southwest is just one example of an emerging trend among companies that follow the “hire for attitude, train for skill” model — from high-tech giants such as Motorola and Solectron to Quad/Graphics, a billion-dollar printing company based in rural Wisconsin. These companies are convinced that the most promising source of new talent are the relatives of talented employees.

Quad/Graphics, whose spectacular growth has been chronicled in dozens of business books, may hold the corporate record for family ties. Of the company’s 8,416 employees, 4,848 are related by blood or marriage — that’s nearly 60%. The company has 267 married couples, 836 brothers, 276 sisters, 128 sons, 95 daughters, and 1,058 cousins. The trend has progressed so far that Quad is building a $5 million apartment complex outside its plant in Lomira, Wisconsin. Originally, the complex was designed as a recruitment device — a way to provide new employees with affordable housing. Increasingly, though, it is being designed to house a second generation of Quad “family” employees.

“A lot of our people’s children get jobs here and they really like it,” says Gayle Kugler, Lomira’s plant manager. “But then it gets a bit too close. They tell their parents, ‘I live with you, I work with you, I need my space.'”

Many of the one-to three-bedroom apartments, Kugler says, will go to 20-something employees whose parents also work at the plant.

Why such enthusiasm for family ties at work? Companies that embrace the policy agree on three major benefits:

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The best talent pool is the gene pool.

Doubletree’s Ann Rhoades makes the point. “If you have a mother with a great work ethic,” she argues, “chances are her daughter is going to have a great work ethic.” Indeed, Rhoades recently traveled to Seattle to bestow “employee of the year” honors on a mother-daughter team.

Biology promotes honesty.

Companies like Quad and Southwest argue that family ties encourage candor; people tend not to sugarcoat the truth with or about their families. Phelps remembers a call she received not too long ago from a woman in Southwest’s finance department who’d heard her son was up for a job. The company, it turns out, was unconvinced that he had what it takes. Phelps remembers the conversation: “I was bracing myself. ‘Sherry,’ she said, ‘I want to tell you about my son. Do not hire him. He is lazy. He will not make a good Southwest employee.’ My reaction was, ‘Amen! The system works.'”

Families that work together stay together on the job.

Even companies that know how to find great people face another big challenge: holding on to them. Doubletree’s Rhoades is convinced that family ties make for more enduring ties between people and the company. “If you have several family members at a company, and they’re all happy there, then those positive feelings build on one another,” she argues. “Family members don’t want to leave an organization if other family members are there. So it becomes a retention advantage.”